Darlene WALKER, Plaintiff-Appellant, v. Constance A. CRIGLER; Frank B. Whitesell, III, Defendants-Appellees.
No. 91-1542.
United States Court of Appeals, Fourth Circuit.
Decided Oct. 5, 1992.
On Petition for Rehearing with Suggestion for Rehearing In Banc Nov. 19, 1992.
Argued Feb. 6, 1992.
In light of our conclusions and the generally recognized benefit that VMI provides, we do not order that women be admitted to VMI if alternatives are available. But VMI‘s continued status as a state institution is conditioned on the Commonwealth‘s satisfactorily addressing the findings we affirm and bringing the circumstances into conformity with the Equal Protection Clause of the Fourteenth Amendment. By commenting on the potential benefits of single-gender education while discussing the alleged governmental interest in support of VMI‘s admissions policies, we do not mean to suggest the specific remedial course that the Commonwealth should or must follow hereafter. Rather, we remand the case to the district court to give to the Commonwealth the responsibility to select a course it chooses, so long as the guarantees of the Fourteenth Amendment are satisfied. Consistent therewith, the Commonwealth might properly decide to admit women to VMI and adjust the program to implement that choice, or it might establish parallel institutions or parallel programs, or it might abandon state support of VMI, leaving VMI the option to pursue its own policies as a private institution. While it is not ours to determine, there might be other more creative options or combinations.
Accordingly, we vacate the judgment and remand the case to the district court: (1) to require the defendants to formulate, adopt, and implement a plan that conforms with the Equal Protection Clause of the Fourteenth Amendment, (2) to establish appropriate timetables, and (3) to oversee the implementation of the plan.
VACATED AND REMANDED FOR FURTHER PROCEEDINGS.
On Petition for Rehearing with Suggestion for Rehearing In Banc
Nov. 19, 1992.
Appellees filed a petition for rehearing with suggestion for rehearing in banc and appellant filed an answer to the petition. A member of the Court requested a poll on the suggestion for rehearing in banc, and a majority of the judges voted to deny rehearing in banc. Judges Widener and Hamilton voted to rehear the case in banc, and Chief Judge Ervin and Judges Russell, Hall, Phillips, Murnaghan, Wilkins, Niemeyer, and Williams voted to deny a rehearing in banc. Judges Wilkinson and Luttig did not participate in the decision.
The original judicial panel voted to deny the petition for rehearing.
The Court denies the petition for rehearing with suggestion for rehearing in banc.
Entered at the direction of Judge Niemeyer, with the concurrence of Judge Phillips and Judge Ward, Senior United States District Judge, sitting by designation.
John Peter Relman, Washington Lawyers’ Committee for Civil Rights under Law, Washington, D.C., argued (Hunter C. Harrison, Jr., Sandra L. Hughes, Harrison, Golden & Hughes, P.C., McLean, Va., on brief), for plaintiff-appellant.
Robert Emmett Scully, Jr., Rees, Broome & Diaz, P.C., Vienna, Va., argued (Susan A. Richards, on brief), for defendants-appellees.
Before WIDENER, PHILLIPS, and MURNAGHAN, Circuit Judges.
OPINION
MURNAGHAN, Circuit Judge:
The present case arises as an appeal by appellant Darlene Walker from a judgment entered in the United States District Court for the Eastern District of Virginia. Walker brought suit against Constance A. Crigler, a professional realtor, and against Frank B. Whitesell, the owner of the rental
The jury returned a verdict in favor of Walker against Crigler and ordered the latter to pay $5,000 in compensatory damages, but indicated no punitive damages. Conversely, the jury found for Whitesell and cleared him of all charges and liabilities. Subsequently, appellant filed a motion for a new trial, a motion for judgment notwithstanding the verdict, and submitted new pleadings in support of a request for declaratory and injunctive relief that had remained pending since the conclusion of trial.
On April 1, 1991, the district court denied all of appellant‘s motions, and refused to order the declaratory or injunctive relief. Walker filed a timely notice of appeal from the district court‘s rulings on the issues of denial of judgment n.o.v. and denial of the requested declaratory relief.
I.
Appellant is a single mother with one son. In 1986, she and her son moved to Falls Church, Virginia where appellant was and remains employed with the Central Intelligence Agency. Upon her arrival in Falls Church, appellant rented a pair of rooms in a four bedroom home for her and her son.
In late 1987, appellant‘s landlord reclaimed one of the two rooms, and she became interested in finding a new residence. Approximately two years later, in July of 1989, appellant contacted Town and Country Properties to inquire about rental properties in the area. Appellant spoke to Maurice Hill, an agent at Town and Country, who provided her with various property listings taken from the firm‘s Multiple Listing Service ( “MLS” ) computer listings. Appellant viewed two of the properties accompanied by Hill‘s assistant John Moore ( “Moore” ).
On the night of July 27, 1989, appellant and Moore visited a property located at 124 Falls Avenue in Falls Church. Whitesell
The listing in the MLS described the property as “a nice 2BR (two bedroom)” apartment “ideal for two men.” The listing also indicated that the property had “3 guys” as tenants, and that the rent was $600 per month.
In January of 1989, Whitesell, in response to an awareness of housing discrimination suits against landlords, sent Crigler a memorandum which read:
In view of the recent legal action against rental property owners I have been advised by my attorney to submit the following statement:
No one who meets all other qualifications for tenancy on (sic) one of my properties is to be denied the right to rent such properties solely because of discrimination on the basis of race, creed or physical impairment ...
Obviously, this notice includes no provision against gender discrimination, but Crigler contended that the meaning of the letter, that all federally mandated anti-discrimination provisions should be met, was clear.
Appellant was unable to tour the 124 Falls Avenue apartment because there was no key available. But given its location so close both to school for her boy and to transportation to work for herself, she decided that she wanted the apartment, and filled out an application for it with Moore‘s assistance.
Later that night or early the next morning, Moore contacted Crigler to tell her that he had an application he wished to present on the Falls Avenue property. Both parties agree that Ms. Crigler inquired about the applicant, but that recollection is the end of their agreement.
Moore testified that he advised Crigler that the applicant was a single mother and that Crigler in no uncertain terms said that she would not rent to appellant because she was a woman. She expressed her policy of not renting to women in any circumstances. Crigler never reached the point of asking about appellant‘s financial qualifications, but Moore said that he told her that the applicant was financially qualified. Based on that conversation, Moore determined that it would be futile to deliver appellant‘s application to Crigler.
Appellant called Crigler after Moore relayed his conversation with the property manager. According to appellant, Crigler told her she would not rent the apartment to a single woman, and that she had experienced problems with the boyfriends of single women in the past. Crigler testified that she never told anyone that she would not rent to appellant because of her gender, but that her expressed rationale was that appellant did not meet the financial requirements set out for the unit. Appellant testified that she asked Crigler if she was speaking on behalf of the owner of the apartment, and Crigler replied that she was. Appellant then related the substance of her conversation to Hill at Town and Country.
Hill subsequently called Crigler and she repeated to him her policy of not renting to women. Between August 10 and October 19, appellant filed various administrative, local and state discrimination suits against the Town and Country officials and Crigler. She did not know who owned the 124 Falls Avenue unit at the time of those suits. On October 5, the unit was finally rented to two men who paid $580 monthly rent, twenty dollars less than appellant had been willing to pay.
On August 9, 1990, appellant filed the present action against Crigler and Whitesell alleging discrimination in violation of
At trial, Crigler denied that she ever referred to appellant‘s gender as the reason for her refusal to rent to her. Whitesell made little effort to defend Crigler‘s actions and argued that he should not be held liable for her mistakes. At the conclusion of appellant‘s case, the court granted Whitesell‘s motion to strike appellant‘s punitive damages claim against him. Thus the only remaining claims were for punitive and compensatory damages against Crigler and compensatory damages against Whitesell.
The jury found for plaintiff in the suit against Crigler, but fully exonerated Whitesell of any responsibility for the discriminatory acts of his employee. The court had instructed the jury that they should find Whitesell liable for damages to appellant if they believed that Crigler, in practicing discrimination against appellant, was an agent of Whitesell, acting within the scope of her employment. The jury ordered compensatory damages of $5,000 to be paid by Crigler.
Following the trial, appellant filed a motion for judgment n.o.v., and for a new trial. In addition, appellant filed a memorandum in support of a request for a declaratory judgment and injunctive relief, requesting that the court enter judgment against Whitesell, arguing that Crigler, as a matter of law, was an agent of Whitesell, and that she had clearly acted within the scope of her authority when she harmed appellant.
On April 1, 1991, the district court denied all of appellant‘s post-trial motions. Appellant filed a timely notice of appeal. On April 19, Crigler filed a voluntary Chapter 7 bankruptcy petition. On August 9, 1991, appellant received a notice from the Bankruptcy Court indicating that Crigler‘s $5,000 debt to her had been discharged.
II.
The denial of a motion for judgment n.o.v. “cannot be disturbed unless, without weighing the evidence and assessing witness credibility, we conclude that reasonable people could have returned a verdict only [for the moving party].” Cooper v. Dyke, 814 F.2d 941, 944 (4th Cir. 1987). The denial of a motion for a new trial should be reversed only when abuse of discretion on the part of the trial court is shown in its determination that “[t]he jury‘s verdict was not against the clear weight of the evidence....” Abasiekong v. City of Shelby, 744 F.2d 1055, 1059 (4th Cir. 1984).2
The jury ruled on the case against Whitesell in his favor, holding, apparently, that Crigler was not acting in the scope of her employment when she denied Walker‘s attempts to rent the 124 Falls Avenue premises because she was a woman.3 The sole evidence to support the jury‘s conclusion that Whitesell was not liable for damages for the discrimination was the evidence indicating that Crigler was instructed not to refuse to rent on discriminatory grounds. In denying the motion for judgment notwithstanding the verdict, the trial judge concluded that the evidence of Whitesell‘s instruction was sufficient to support the jury‘s verdict. We find, however, that the court‘s conclusion is based on an erro-
We accept the jury‘s finding that Whitesell did not confer on Crigler the right to discriminate, or even indicate his intention that she discriminate. The evidence is sufficient to support the conclusion that Whitesell specifically intended that Crigler not discriminate. In many cases, involving issues other than housing discrimination, such a finding would refute the assertion that Crigler had acted within the scope of employment, and would concurrently, shield Whitesell from any liability as principal. However, the arguable conclusion that Crigler acted outside the scope of her employment is irrelevant in the present case, for Whitesell could not insulate himself from liability for sex discrimination in regard to living premises owned by him and managed for his benefit merely by relinquishing the responsibility for preventing such discrimination to another party.4 Here we adopt the general rule applied by other federal courts that the duty of a property owner not to discriminate in the leasing or sale of that property is non-delegable.5
The dissent cites regulations which govern the adjudication of fair housing proceedings brought in front of the Department of Housing and Urban Development ( “HUD” ) to support its proposed rejection of the conclusion that a property owner has a non-delegable duty to prevent discrimination.6 These regulations, as the dissent concedes, do not cover the circumstances of the present case which is a private cause of action and not a complaint filed with HUD.7 The cited regulations do not support rejection of the existing strong line of precedent which, unlike the regulations, does address directly the proper determination of the duty of a property owner in a private housing discrimination cause of action.
We are not unmindful of the arguable incongruity of applying liability to Whitesell, and others similarly situated, who are apparently non-culpable in a housing discrimination instance, but must still bear the burden of liability. The central question to be decided in a case such as this, however, is which innocent party, the owner whose agent acted contrary to instruction, or the potential renter who felt the direct harm of the agent‘s discriminatory failure to offer the residence for rent, will ultimately bear the burden of the harm caused. It is clear that the overriding societal priority of the provision of “fair housing through out the United States” clearly set out in the Fair Housing Act,8 indicates that the one innocent party with the power to control the acts of the agent, the owner of the proper-
Whitesell, despite forbidding discrimination on the part of Crigler, cannot, under the Fair Housing Act, dispose of his duty to prevent sexual discrimination in the renting of 124 Falls Avenue, a property which he owned and which was operated for his benefit.10
There remains for consideration Walker‘s request for a declaratory judgment and injunctive relief which would ban rental discrimination violative of
REVERSED, JUDGMENT ORDERED ENTERED, AND REMANDED.
WIDENER, Circuit Judge, dissenting:
In holding a property owner‘s duty to comply with the Fair Housing Act to be “non-delegable,” the majority effectively imposes strict liability upon a property owner for the discriminatory acts of his agent. Under this rule, even the most conscientious and careful property owner, as there was here, will be unable to protect himself from liability resulting from the forbidden acts of unscrupulous agents.1 I am of opinion that the Department of Housing and Urban Development, the federal agency charged with administering the Fair Housing Act, has made clear that ordinary principles of agency law are not to be
The Fair Housing Act,
The HUD regulation most relevant here provides as follows:
§ 103.20 Persons against whom complaints may be filed.
(a) A complaint may be filed against any person alleged to be engaged, to have engaged, or to be about to engage, in a discriminatory housing practice.
(b) A complaint may also be filed against any person who directs or controls, or has the right to direct or control, the conduct of another person with respect to any aspect of the sale, rental, advertising or financing of dwellings or the provision of brokerage services relating to the sale or rental of dwellings if that other person, acting within the scope of his or her authority as employee or agent of the directing or controlling person, is engaged, has engaged, or is about to engage, in a discriminatory housing practice.
The history of the promulgation of the present section 103.20 confirms that HUD in no way intended to impose strict vicarious liability upon innocent property owners. HUD first addressed this issue in 1984, when it published a proposed section 105.13, also entitled “Persons against whom complaints may be filed.” That proposed regulation provided as follows:
(a) A complaint may be filed against any person alleged to be or have been engaged, or to be about to engage, in a discriminatory housing practice.
(b) Any person who directs or controls, or has the right to direct or control, the conduct of another person with respect to any aspect of the sale, rental, advertising or financing of dwelling [sic] or the provision of brokerage services relating to the sale or rental of dwellings is responsible for discriminatory housing practices by such other person.
49 Fed.Reg. 40533 (proposed Oct. 16, 1984). Importantly, this regulation is substantially identical to the present
However, HUD‘s comments accompanying the publication of the final version of the rule in question, which remains the version in force today, both make clear that no strict liability was intended and shed light on HUD‘s understanding of the concept of nondelegability. Those comments tell us that the National Association of Realtors (NAR) “strenuously objected” to the proposed section 105.13(b). According to HUD,
NAR contended that the judicial decisions do not establish a rule of absolute liability (without fault) as paragraph (b) would impose. NAR argued that the decided cases focus only on the liability of a broker for conduct of his or her salespersons, but do not mandate absolute liability on the basis of mere right “to direct or control” without reference to instructions, policies, compliance programs and other actions of the principal.... In response, it is not HUD‘s intent to impose absolute liability on any principal; the intent, in proposing paragraph (b), was to follow the law enunciated by the courts in recent Fair Housing Act cases with respect to the liability of a principal for acts of an agent.... HUD has revised the language of paragraph (b) of [now § 120.30] to provide that a complaint may be filed against a directing or controlling person with respect to the discriminatory acts of another only if the other person was acting within the scope of his or her authority as employee or agent of the directing or controlling person.
53 Fed.Reg. 24185 (1988); see also 54 Fed. Reg. 3260-61 (1989). Thus, this comment only confirms the most straightforward reading of the text of the present section 103.20, i.e., that familiar principles of agency law, and not strict liability, control a principal‘s liability for the acts of an agent.
While I am of opinion that the aforementioned HUD regulation standing alone sufficiently establishes that the doctrine of respondeat superior governs the liability of a principal for the discriminatory acts of his agent; I pause for a moment to consider the case law cited by the majority for the proposition that a property owner‘s vicarious liability under the Act is strict. Certainly, a good deal of case law exists holding principals vicariously liable for the Fair Housing Act violations of their agents. Many of these cases indeed use the term nondelegable in describing a property owner‘s responsibility for compliance with the Fair Housing Act. The cases fall far short, however, of establishing a general rule that traditional principles of agency law have no application in Fair Housing Act cases.
For example, in Marr v. Rife, 503 F.2d 735 (6th Cir. 1974), perhaps the most oft-cited case for the strict liability position, the Sixth Circuit held liable the owner of a real estate agency for the discriminatory acts of his agents. The court‘s discussion of the scope of the principal‘s vicarious liability, however, leaves much to be desired in terms of clarity. The Marr court relied primarily on three cases, none of which squarely supports a rule that inquiry into whether a wrongdoing agent was acting within the scope of his employment is irrelevant. First, the court cited United States v. Northside Realty Assoc‘s, Inc., 474 F.2d 1164 (5th Cir. 1973), a case that in fact supports the application of traditional agency law in assessing liability of a principal under the Act. See Marr, 503 F.2d at 741, quoting Northside Realty, 474 F.2d at 1168 (holding that agent of defendant corporation “acted within the scope of his duties” during discriminatory conduct). Second, the court relied upon United States v. Youritan Construction Co., 370 F.Supp. 643 (N.D.Cal. 1973), aff‘d in part and rev‘d in part, 509 F.2d 623 (9th Cir. 1975). Youritan at best presents a discussion of both aspects of the law of vicarious liability before us here, and it too can be read as contemplating application of respondeat superior principles under the Act. See Marr, 503 F.2d at 741, quoting Youritan, 370 F.Supp. at 649. Finally, the Marr court cited United States v. Real Estate Development Corp., 347 F.Supp. 776 (N.D.Miss. 1972). Again, though the
While [the] evidence does not indicate that [the agent] acted with the approval or at the direction of [the principal], we do not believe that such a finding is necessary in order to hold [the principal] liable. As owner of the agency, [the principal] had at least the power to control the acts of his salesmen.
Marr, 503 F.2d at 742. This holding hardly constitutes a ringing endorsement of the nondelegability approach; in fact, the language is fully consistent with application of the law of respondeat superior. On the whole, I simply find uncompelling the reasoning of the Marr opinion.
Neither do I believe that Coates v. Bechtel, 811 F.2d 1045 (7th Cir. 1987), supports the strict liability approach of the majority in the instant case. Indeed, I suggest its holding is quite to the contrary. In Coates, the Seventh Circuit reversed as an abuse of discretion the district court‘s award of attorney‘s fees to the prevailing defendant in a case brought under the Fair Housing Act. The defendant in question was the absentee owner of a mobile home. The owner had agreed to sell the mobile home to a black couple, the sales arrangements being handled by two of the defendant‘s
The district court granted summary judgment in favor of the owner on grounds that the agents had not acted within the scope of their actual or apparent authority in discriminating against the buyers on the basis of their race. See Coates, 811 F.2d at 1048 and n. 1. The district court further granted the owner‘s motion for attorney‘s fees pursuant to
On appeal, the Seventh Circuit considered only the propriety of the fee award under section 1988. The court reversed that award and held that the buyers’ claim, though without merit, was not frivolous, groundless, or unreasonable. In evaluating whether the claim was sufficiently colorable to preclude an award of fees to the owner, the court acknowledged that familiar principles of agency law governed the owner‘s liability and that the buyers conceivably could have made out a claim of vicarious liability against the owner had the facts been more favorable to the plaintiff buyers.3 Nowhere does the opinion suggest that principles of strict liability apply to the buyers’ claims against the owner. Apparently the majority arrives at its conclusion from Coates’ parenthetical reference to Phiffer, infra, n. 4.
I shall not belabor the point by discussing further the case law addressing vicarious liability under the Act.4 Though I am aware of no case squarely adopting the position of the majority in the instant case, my point is not that the broad range of reported cases do not hold property owners to a rigorous standard for the acts of their agents. Indeed, courts rightly have been quick to hold principals liable for the unlawful discrimination of their agents when the facts reveal that a principal has done nothing to guard against the occurrence of such discrimination. I wish only to show that, contrary to the suggestion of the majority, the cases reveal no consensus that principals are to be held liable under the Act without regard to traditional agency law in general, and scope-of-employment law in particular. Accordingly, I would look to the plain language of
Having stated my opinion that Whitesell‘s liability to Mrs. Walker, if any, must be under the traditional principles of respondeat superior, I now turn to the question of whether the jury‘s verdict in favor of Whitesell was supported in law and fact.
I note this part of the majority opinion with which I agree: “We accept the jury‘s finding that Whitesell did not confer on Crigler the right to discriminate, or even indicate his intention that she discriminate. The evidence is sufficient to support the conclusion that Whitesell specifically intended that Crigler not discriminate.” That being the case, and no error of law being relied upon by the majority other than its holding that the responsibility of Whitesell was nondelegable, I would simply affirm the judgment of the district court.
H. EMORY WIDENER, JR.
UNITED STATES CIRCUIT JUDGE
Notes
The central factual issue underlying the plaintiffs’ vicarious liability claim against Tom was the scope and nature of the agency relationship between Tom and Fritz. As a matter of well-settled agency law, a principal may be held liable for the discriminatory acts of his agent if such acts are within the scope of the agent‘s apparent authority, even if the principal neither authorized or ratified the acts. In cases of racial discrimination in housing under both